The hard money loans industry dates back to the 1950s when the U.S. economy experienced an overhaul in the consumption of loans. Several decades down the line, the industry has grown to be what it is today.
Currently, Atlanta has approximately 50 private lenders operating within the city. The rapid increase in the number of lenders shows that private loans have more to offer than quick approvals. Read on for some of the irresistible features of hardy money loans.
Faster Turnaround
Compared to bank financing, one major advantage of private lending is faster access to loans. Hard money loans are known for their quick approvals, with some available on the same day.
There is also the rapid dispersal of funds, which mostly occurs a few days after the approval. The fast turnaround on the fix and flip loans gives investors an added advantage when looking to buy properties at an auction.
Simpler Application Processes
Banks are a good financing option, but the lengthy application process discourages many potential clients. The application process, in this case, will involve aspects of credit history as well as financial statements. In the U.S., a majority of borrowers have bad credit history.
While conventional banks will use your credit history, hard money lenders will not check such records. As long as you meet the minimum requirements in terms of collateral, you stand a good chance to enjoy the quick approvals of real estate loans.
Consequently, private lenders offer bad credit loans that ensure you don’t miss out on viable investment opportunities.
Hard Money Loans Are Profitable
Many real estate business deals can benefit from the quick approvals of hard money. Timely approval allows you to take advantage of investment opportunities when the asking price is still low.
The convenience of these loans also allows you to sell the acquired properties at a higher value. The higher value will generate enough money to fund the loan and still have something in the form of profits.
Hard Money Loans Are Versatile
Hard money loans are made on a variety of properties ranging from single-family homes to commercial buildings. The wide range of applicable properties means that these loans amplify the profit opportunities for investors.
Additionally, these loans are independent in that only the submitted collateral will be affected when things don’t work according to the initial plan. However, hard money lenders in Georgia are open to repayment negotiations.
Low Rejection Rates
Getting a loan to buy property is a challenge to most real estate investors. Conventional banks are demanding several requirements, most of which investors cannot meet.
On the flip side, private lending has grown into a more reliable financing option. With only 25% equity in the collateral provided, you stand a good chance to qualify for these loans.
Hard Money Is Just a Loan
In reality, hard money refers to a short-term loan that is mostly secured using tangible assets, with real estate being the priority. Hard money loans have quick approvals and are most beneficial in the short-term.
Additionally, hard money lenders in Georgia are private investors willing to lend their money for a small profit. However, borrowers will be required to put up collateral to guarantee this alternative financing option.
Private Loans Offer More Than House-Flipping
Hard money loans have, for the longest time, been associated with house flippers. While they are a perfect solution for fix and flip housing investors, the loans can also be used to finance large commercial projects.
Final Word
Hard money loans are a reliable short-term financing option in the real estate sector. Now that you know what hard money loans entail, it is time to turn that investment opportunity into a profitable business. Contact us today if you are looking for a trusted and reliable hard money lender in Georgia.